Senate probe into the operations of underperforming distribution utilities pushed

Senator Win Gatchalian wants to dig deeper into the operations of underperforming distribution utilities (DUs) in the country amid persistent complaints of rolling brownouts in several areas in the country.

Gatchalian, chair of the Senate Committee on Energy, recently filed Senate Resolution No. 1022, which directs the conduct of an inquiry, in aid of legislation, on the operations of underperforming DUs in the country and the remedies to hold them accountable.

For the lawmaker, it is high time for Congress to assess whether or not non-performing DUs should continue operating using their franchise by looking at their respective performances.

"Various hearings of the Senate Committee on Energy has brought to light the issues surrounding DUs, such as non-compliance with the system loss caps, System Average Interruption Duration Index (SAIDI), System Average Interruption Frequency Index (SAIFI), financial liabilities, in the case of electric cooperatives; and failure to electrify areas within their respective franchises - thereby resulting in the prejudice of consumers," Gatchalian said in the resolution.

"Given the foregoing shortcomings of DUs, there has been no policy or procedure for DOE (Department of Energy) or ERC (Energy Regulatory Commission) to determine underperforming DUs, whose franchise will be recommended for revocation," he added.

Gatchalian said he received numerous complaints regarding the underperformance of several DUs across the country. Palawan, for example, had experienced an average of 126 power interruptions in 2017, which, according to the lawmaker, was beyond the NEA standard of 25 interruptions per consumer per year.

Citing data from the DOE, Gatchalian also pointed out that 72.6 percent or 449,410 out of 618,600 households in the Autonomous Region in Muslim Mindanao (ARMM) remain without power as of December 31, 2017, making it the top "unelectrified" region in the country.

The DOE and ECs locked horns last month after the former submitted a letter to Speaker Gloria Macapagal-Arroyo recommending the cancellation of the legislative franchises of at least 17 ECs. In its December 2018 report, the National Electrification Administration (NEA) revealed at least 10 of the underperforming ECs are in Luzon while seven others are in Mindanao.

However, the energy department backpedaled on January 30 after it received reports from these electric cooperatives that they had already addressed the issues against them.

Gatchalian said that while he fully supports holding distribution utilities accountable in their services to consumers by reviewing their technical and financial performance, he stressed the need to have a clear policy and procedure on the recommendation for revocation before actually submitting the recommendation to Congress.

"The situation above highlights the necessity for a clear policy and procedure on how DUs can be held accountable for their duties and responsibilities under the EPIRA (Electric Power Industry Reform Act of 2001), through the recommendation of DOE or ERC for the revocation of their franchise, all towards the promotion and protection of consumers' interest," Gatchalian said.